MLS Jersey Sponsorship Tells Two Different Stories

The rise of Major League Soccer (MLS) in America is well documented.  Since 1996 the league has seen the completion of the nation’s first soccer specific stadiums, crowds of over 50,000 for regular season matches, and the meteoric rise of some of its locally grown players.  MLS has also seen some clubs call oversized football arenas home, games where fewer than 4,000 fans turn out to watch, and the collapse of several franchises.  This is simply the Jekyll and Hyde of a league that remains unpredictable.  MLS can be summed up as a tale of two leagues.  Early in league history, it certainly appeared to be the worst of times with Miami and Tampa Bay folding at the end of the 2001 season.  Yet MLS has managed to survive, and thrive, in recent years where fans have witnessed some of the best of times.

This tale of two leagues is not just seen in attendance and expansion clubs.  Jersey sponsorships also write a unique story for MLS.  The sport of soccer does not lend itself to the same convenient methods of advertising the way that other American sports use, with their commercial breaks, promotion from commentators, fan-friendly President-races, etc.  One of the best methods for companies to gain attention in soccer is through a jersey sponsorship, which are often the most lucrative sponsorships in the soccer world.  Top clubs such as Real Madrid and Bayern Munich have reeled in deals worth upwards of $39 million per year.  Barcelona FC even struck a $25 million deal with Intel to print their logo inside the jersey.

READ: Intel Breaks the Mold with Barcelona Inside Shirt Sponsorship Deal

Since MLS is an infant compared to other top soccer leagues around the world, it is fair to assume that companies would not invest in  jersey sponsorships with its clubs unless the companies were sure they would get a good return on their investment.  When MLS opened in 1996, only a few teams displayed logos on their jerseys.  However, the sponsors were league sponsors and not sponsors of the teams individually.  AT&T was shown on Dallas Burn jerseys, Honda was displayed on San Jose Clash jerseys, and D.C. United had Mastercard on their jerseys.  Surprisingly, the sponsor’s logo was not even located on the front of the jersey.  All sponsorships appeared on the back of the jersey below the players’ numbers.

D.C. United '98 Home Jersey. Courtesy MLSArchives.com

D.C. United ’98 Home Jersey. Courtesy MLSArchives.com

In 2007, MLS allowed clubs to place sponsorships on the front of team jerseys.  The year 2005 appears to be a turning point in league history since it survived contraction in 2001 and saw two new teams enter the league.  Each year since 2005 MLS added at least one new team per year until 2013.  In this time period, jersey sponsorship increased as well.  Below is a graph that shows the number of MLS teams that had jersey sponsors in each season since 2005.

This upward trend in sponsors coincides with the growth, stability, and popularity of the league.  Many expansion teams entered the league with sponsors lined up, including Toronto, Seattle, Portland, Vancouver, and Montreal.  Colorado signed its first jersey sponsorship in club history in May with Ciao Telecom, and most recently, Houston added BHP Billion as a jersey sponsor last week, filling the void left by Greenstar in 2013.  San Jose is the only MLS team to not have a jersey sponsor in the 2014 season.  Reports indicate that the club has been in talks with combining both jersey sponsorship and naming rights to their new stadium that will open in 2015, which could explain why the club is delayed vs. the rest of the league because they are going for a package deal which is almost assuredly comes with a higher price tag and will take longer to attract companies and go through the process, etc.

The quantity of sponsorship amongst MLS teams only paints part of the picture.  Several general managers and front office staff of MLS teams have stated clearly that they were not searching for just any sponsor.  Many are opting for local sponsors in an effort to build connections in the local fan base.  Sporting Kansas City penned a deal with Ivy Funds, located in Overland Park, Kansas in 2013.  CEO Robb Heineman stated,

Local was always the thing that was going to be most important to us in a jersey sponsor and then innovation…We wanted something that connected to our community in a large way…

This same approach is true for Chicago, Columbus, D.C United, FC Dallas, Los Angeles, Montreal, Portland, Real Salt Lake, and Seattle, each signing sponsors with local ties to their community.  This signifies a grassroots approach to sponsorship where MLS can build a foundation and create loyalty between businesses and families.

There is still work to be done for MLS clubs before they reel in major jersey sponsorships, however.  Estimates indicate that MLS teams take in anywhere between $1 million and $4 million annually from jersey sponsors.  The league as a whole is still a great distance away from signing the same lucrative deals as seen in the top 5.  Yet, there is still a bright future for soccer in America, especially considering the interest the 2014 World Cup provided in the United States that will hopefully translate to MLS after the tournament is over.  Tony Bennett’s words might be more appropriate than the paradoxical Dickens’ in describing MLS’ quest for jersey sponsors.  Perhaps “the best is yet to come”…

 

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Reporting on the business side of the world's game.